Federal Credit Union Act Signed 80 Years Ago Today
Thursday, June 26, 2014 8:00 AM

Thursday, June 26, 2014 (FARMERS BRANCH, Texas) – Eighty years ago today, President Franklin Roosevelt signed the Federal Credit Union Act into law. Cornerstone Credit Union League CEO Dick Ensweiler says with a stroke of that pen, credit unions were given the green light to form across the U.S.

“The signing of the Federal Credit Union Act is a historic moment for our credit union movement. Thanks to Roosevelt’s belief in financial cooperatives, today nearly 100 million people are benefitting from a relationship with a consumer-owned, volunteer-led, democratically controlled credit union,” notes Ensweiler.

Gary Williams, president and CEO of the oldest credit union located in Texas, Unity One CU, says the Federal Credit Union Act paved the way for the growth and expansion of the credit union movement.

“Credit unions were already in existence when the act was signed. Unity One, for example, was chartered in 1927 by employees of the railroad. Since then, we have expanded our field of membership, changed our name, and switched from a federal charter to a state charter, but one thing that remains the same is our firm belief that all consumers deserve access to affordable financial services. The Federal Credit Union Act validated the important role credit unions play in the lives of American families.”

Credit unions are not-for-profit financial cooperatives – bound together by a common set of business principles and values, which include volunteer leadership; democratic control; economic participation; autonomy and independence; member education; cooperation among cooperatives; and concern for community.

Since the signing of the Federal Credit Union Act, credit unions have developed considerably. There are currently 6,700 credit unions in the U.S, and Ensweiler points out that these financial cooperatives offer a broad range of financial services, from mortgage lending to education loans to digital banking.

Richard Menton, president and CEO of one of the oldest credit unions in Oklahoma, Cherokee Strip CU, says credit unions’ cooperative business model has a direct benefit for consumers.

“Credit unions are governed by a volunteer board of directors, so we do not have paid shareholders to satisfy. That means credit unions return financial benefits directly to our members with favorable returns on savings, competitive rates on loans, and fewer and lower fees,” says Menton. “Even if you aren’t a credit union member, you benefit from our presence in the market space because we force the competition to be – well, more competitive in their pricing of financial products and services.”

According to Ensweiler, an impressive $761.6 million in savings and financial benefits in 2013 alone is attributed to credit unions in Arkansas, Oklahoma and Texas. Other key statistics include:

 

Arkansas

Oklahoma

Texas

Total Loan Dollars in Circulation [2013]

$1.6 billion

$7.3 billion

$53.4 billion

Amount of New Loans Granted [2013]

$926.6 million

$4.2 billion

$27.2 billion

Amount of First Mortgages Established [2013]

$144.9 million

$720.6 million

$4.9 billion

Current Amount of Vehicle Loans Financed

$866.1 million

$4.4 billion

$25.9 billion

Salaries and Benefits Paid [2013]

$36.4 million

$180.0 million

$1.3 billion

Total number of employees

791

3,161

22,776

Number of Credit Unions as of December 2013

61

67

505

Linda Jeffery, CEO of TruService Community FCU in Little Rock, Ark., adds, “Credit unions have never lost sight of our business principles and values, and we will continue to put our members and community first, as I believe that is what has made us such a successful movement.”

TruService Community FCU is the oldest credit union in Arkansas, chartered by the United States Postal Service employees in 1930. Jeffery says at TruService Community FCU, members aren’t customers – they’re owners.

“We’ve grown to nearly $38 million in assets because we put the needs of our nearly 6,000 members first. Whether they come into one of our three locations, call us on the phone, or reach us over the internet, we strive to provide exceptional service and offer the tools and resources to help our members build wealth and achieve economic stability,” she continued.

Like most credit unions, Unity One CU, Cherokee Strip CU, and TruService Community FCU strive to remove barriers that might exist in serving segments of the population that may be unbanked and/or underserved; work with civic organizations like the local Chamber of Commerce; participate in local events such as fairs and other events to engage and educate the public; demonstrate community leadership through charity involvement such as fundraising for Children’s Miracle Network; and support financial literacy.

PDF Federal Credit Union Act Signed 80 Years Ago Today -- Cornerstone Credit Union League CEO Dick Ensweiler and CEOs of oldest credit unions in region comment